The 10 most ‘absurd’ employer excuses for flouting the national minimum wage rules have been published by HM Revenue and Customs, including claims that employees were too young to be paid the minimum rate or had signed contracts opting them out of the entitlement.
HMRC said it helped more than 155,000 UK workers recover more than £16 million in wages owed by employers that breached national minimum wage rules in the 2020/21 tax year. Employers were issued fines totalling £14 million.
Steve Timewell, director for individuals and small business compliance at HMRC, reminded employers that staff cannot be asked or told to sign away their rights provided by legislation.
“We are making sure that workers are being paid what they are entitled to and, as the economy reopens, reminding employers of the rules and the help that is available to them,” he said.
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“HMRC reviews every complaint made about the minimum wage, so if you think you are being short-changed, or are a business that is unsure of the rules or needs help to get things right, get in touch and we will help you. But any employer deliberately or unapologetically underpaying their staff will face hefty fines and other enforcement action.”
The 10 “most ridiculous” excuses given to HMRC enforcement officers included:
- “She does not deserve the national minimum wage because she only makes the teas and sweeps the floors.”
- “The employee was not a good worker, so I did not think they deserved to be paid the national minimum wage.”
- “My accountant and I speak a different language – he does not understand me, and that is why he does not pay my workers the correct wages.”
- “My employee is still learning so they are not entitled to the national minimum wage.”
- “It is part of UK culture not to pay young workers for the first three months as they have to prove their ‘worth’ first.”
- “The national minimum wage does not apply to my business.”
- “I have got an agreement with my workers that I will not pay them the national minimum wage; they understand, and they even signed a contract to this effect.”
- “I thought it was okay to pay young workers below the national minimum wage as they are not British and therefore do not have the right to be paid it.”
- “My workers like to think of themselves as being self-employed and the national minimum wage does not apply to people who work for themselves.”
- “My workers are often just on standby when there are no customers in the shop; I only pay them for when they are actually serving someone.”
HMRC recently published a list of 191 organisations that breached minimum wage rules between 2011 and 2018, including household names such as John Lewis, McColl’s, Welcome Break and The Body Shop.
Together the 191 employers underpaid 34,000 workers to the tune of £2.1m. The most common error involved organisations wrongly making pay deductions for reasons including uniform and expenses.
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Organisations that breach national minimum wage legislation could be fined and required to pay staff what they are owed at current minimum wage rates.
